Microsoft cancels antitrust hearing in Europe

Microsoft has cancelled plans to hold a face-to-face hearing with European antitrust authorities and rivals scheduled for the first week of June, claiming it wouldn't get a fair audience because senior E.U. officials will be absent.

"We believe that holding the hearing at a time when key officials are out of the country would deny Microsoft our effective right to be heard and hence deny our 'rights of defense' under European law," said Dave Heiner, Microsoft's vice president and deputy general counsel.

Microsoft requested an oral hearing last month when it submitted its formal written response to accusations by the European Commission, Europe's top antitrust authority, that it broke antitrust laws by bundling its Internet Explorer (IE) Web browser in with the Windows operating system.

The Commission proposed June 3-5 for the hearing but Microsoft late Thursday said the dates clash with an annual competition law conference in Zurich, Germany, attended by the most senior Commission antitrust officials.

It asked for a different date but this request was denied, according to Microsoft.

The Commission wasn't immediately available to comment.

The software giant's excuse for cancelling is "ludicrous," said Thomas Vinje, the legal representative of Opera, a rival browser maker whose complaint to the Commission in 2007 sparked the new antitrust case against Microsoft.

Top officials don't show up to individual case hearings, Vinje said. "Such people simply don't attend, and Microsoft knows it," he said in an e-mail to IDG early Friday.

He concluded that Microsoft is "afraid of facing the questions and evidence" from the Commission and from those aligned against it, including not only Opera but also Mozilla, maker of Firefox and Microsoft's nearest rival in the browser market in Europe; Google, maker of the Chrome browser; security software maker Symantec; and industry groups the Software & Information Industry Association (SIIA), the European Committee for Interoperable Systems (ECIS), and the Free Software Foundation Europe (FSFE).

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In January the Commission accused Microsoft of distorting fair competition in the market for Internet browsers by tying IE to Windows which, it argued, gives IE an advantage over rival browsers.

The case is similar to one focussed on IE in the U.S. launched under the final Clinton administration, which was then dropped under the first administration of George W. Bush in favor of a broader antitrust suit in which Microsoft was charged, and later found guilty of, illegally thwarting competition in order to extend its operating system monopoly

It also echoes a previous legal challenge to Microsoft in Europe in 2004, when the Commission ruled that tying Media Player, software that plays video and music tracks, into Windows was illegal for the same reason bundling IE is.

It ordered Microsoft to launch a second version of Windows that had the media player stripped out. However, this remedy is widely seen as being useless, largely because it didn't insist on the unbundled version of the OS being sold at a lower price than the one equipped with Media Player.

This time the Commission is considering forcing Microsoft to include rival browsers inside Windows. The idea would be to give users a genuine choice between browsers.

This so-called "must carry" remedy is broadly supported by the rival browser makers. However, some are worried about the precise wording, arguing that if the Commission isn't careful, its remedy could replace Microsoft's near monopoly with an equally harmful Microsoft/Google duopoly.

Microsoft itself has made similar arguments, warning that the 'must carry' remedy would allow Google to pay manufacturers for presence inside PCs, instead of paying Opera and Firefox for default search engine status on their browsers.

"The proposed remedy could enhance Google's dominance in the lucrative market for Internet search, and force other browsers that currently depend on revenues from Google out of business," said one person close to Microsoft who asked not to be named.